Solana News Today: Solana Pump.fun face $5.5B RICO lawsuit over alleged meme coin gambling scheme as 60% presale liquidated

Generated by AI AgentCoin World
Thursday, Jul 24, 2025 1:46 pm ET1min read
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Aime RobotAime Summary

- A $5.5B RICO lawsuit targets Solana, Pump.fun, and affiliates, alleging an unregulated meme coin gambling scheme.

- Pump.fun’s opaque token model and Solana/Jito’s alleged profit from blockspace fees and MEV tools are central to the claims.

- Market reactions include a 60% presale liquidation and $160M PUMP token sell-off, with legal experts warning of redefined liability for blockchain infrastructure.

- The case challenges decentralized finance’s regulatory boundaries, potentially holding infrastructure providers accountable for network activities.

A federal lawsuit has escalated into a $5.5 billion legal storm targeting

Solana
, Pump.fun, and their affiliated entities, accusing them of orchestrating an unregulated meme coin gambling scheme. The amended class-action complaint, filed in the Southern District of New York and led by Burwick Law, alleges the defendants created a speculative ecosystem where retail investors lost billions through opaque token launches, high-frequency trading strategies, and a lack of investor safeguards. The case invokes the Racketeer Influenced and Corrupt Organizations (RICO) Act, charging violations including fraud, civil conspiracy, and unjust enrichment [1].

At the heart of the controversy is Pump.fun’s memecoin model, which mass-produces tokens with minimal transparency. The platform is described as a “digital slot machine” that encourages speculative behavior without standard protections like KYC or AML compliance. Plaintiffs argue that Solana’s blockchain infrastructure profited through increased blockspace fees and SOL token appreciation tied to Pump.fun’s trading volume, while Jito Labs allegedly enabled front-running using maximal extractable value (MEV) tools. The complaint explicitly rejects the notion of Solana and Jito acting as neutral infrastructure providers, claiming they directly benefited from the scheme [1].

Market reactions have reflected the legal turmoil. Two major investors recently moved $160 million in PUMP tokens to exchanges, triggering a sell-off. Data from BitMEX indicates nearly 60% of presale participants have liquidated holdings, despite Pump.fun’s initial $500 million ICO—completed in 12 minutes—exemplifying the speculative frenzy now under scrutiny. Legal analysts warn the case could redefine liability for blockchain infrastructure providers, as permissionless systems may no longer shield entities if they enable illicit activities [1].

The lawsuit raises broader questions about regulatory boundaries in decentralized finance. While U.S. legal standards allow broad initial allegations, the defendants—including Pump.fun, Solana Labs, and Jito—have yet to respond publicly. If successful, the case could establish a precedent holding infrastructure providers accountable for activities on their networks, challenging the decentralized ethos of blockchain technology. Plaintiffs emphasize the systemic harm of unregulated platforms, arguing the alleged “digital casino” structure demands stringent oversight [1].

The outcome may shape future regulatory frameworks for memecoin projects and crypto infrastructure, balancing innovation with investor protection. Legal analysts highlight the tension between technological advancement and accountability, with implications extending beyond Pump.fun to the broader industry.

Source: [1] [Decrypt: Solana, Pump.fun Named in Amended RICO Suit Alleging $5.5B Meme Coin Gambling Scheme](https://decrypt.co/331528/solana-pump-fun-amended-rico-suit-alleging-meme-coin-gambling)